Related Subjects

Share This

An innovator in contemporary thought on economic and political development looks here at decline rather than growth. Albert O. Hirschman makes a basic distinction between alternative ways of reacting to deterioration in business firms and, in general, to dissatisfaction with organizations: one, “exit,” is for the member to quit the organization or for the customer to switch to the competing product, and the other, “voice,” is for members or customers to agitate and exert influence for change “from within.”

The efficiency of the competitive mechanism, with its total reliance on exit, is questioned for certain important situations. As exit often undercuts voice while being unable to counteract decline, loyalty is seen in the function of retarding exit and of permitting voice to play its proper role.

The interplay of the three concepts turns out to illuminate a wide range of economic, social, and political phenomena. As the author states in the preface, “having found my own unifying way of looking at issues as diverse as competition and the two-party system, divorce and the American character, black power and the failure of ‘unhappy’ top officials to resign over Vietnam, I decided to let myself go a little.”

Stay Posted

Now Available: The digital Loeb Classical Library (loebclassics.com) extends the founding mission of James Loeb with an interconnected, fully searchable, perpetually growing virtual library of all that is important in Greek and Latin literature.

Blog

When transportation involved wind power by sea and animal power by land, few items could be profitably shipped over anything but the shortest distance. This fact made production a hostage of consumption since people were tied to the land. Production, in other words, was forcibly bundled with consumption. Globalization can be thought of as a progressive reversal of this forcible bundling. But the bundling was not enforced by shipping costs alone. Three costs of distance mattered: the cost of moving goods, the cost of moving ideas, and the cost of moving people. It is useful to think of the three costs as forming three constraints that limit the separation of production and consumption. One of…